Central Banks
BoE staff costs rose 6% in 2015, annual report shows
Growing number of senior staff added to central bank’s wage bill for the year; Mark Carney turned down pay rises but still received package worth nearly $1.4 million
RBA minutes note mixed signals for policy
Slight slowdown globally and nervousness over Greece and US rates offset by ‘solid’ lending growth, stronger employment and improved sentiment
Overconfident forecasters may be ‘overrepresented’ in ECB survey
Working paper finds participation in the Survey of Professional Forecasters drops when uncertainty rises, suggesting the results may be biased
EU court rules OMTs are legal
ECB is vindicated as ECJ rules in favour of crisis measure that would see the central bank buy potentially unlimited amounts of sovereign debt to protect ‘singleness’ of monetary policy
Bank of Israel launches journalist briefings as part of transparency drive
Central bank begins quarterly briefings of journalists and adds new publications as part of ongoing efforts to improve communications; follows consultations with other central banks
Market participants cheer FEMR recommendations
Dealers, customers and platforms all welcomed the outcome of the long-awaited review
RBA’s Kent says transmission mechanism seems to be weathering shocks
‘Headwinds’ are working against the Australian economy but the evidence implies the monetary transmission mechanism ‘is about as effective as usual’, assistant governor says
IMF's Blanchard urges compromise in Greek negotiations
Both sides need to make tough choices but more funding and some form of debt relief necessary, says IMF chief economist; Mario Draghi emphasises need for long-term EU institutional change
Draghi defends ‘distributional consequences’ of QE
ECB president suggests easy monetary policy will benefit all citizens in the longer run; economists describe impact on inequality as “ambiguous” in research prepared for Econ Committee
Bank of Russia cuts key rate and moves to replenish foreign exchange reserves
Central bank continues easing cycle with 100bp cut, while stronger ruble gives room to replenish reserves
Governor wants freer thinking at 65-year-old Bank of Korea
Juyeol Lee hints at coming shake-up, calling for openness to ‘creative ideas’ as central bank prepares to set new inflation target
BoE minutes help markets shape expectations, paper finds
Working paper published by ECB finds markets make use of minutes when forming short-term expectations, but relationship breaks down over longer horizons
Nowotny considers ‘human costs’ of structural reform
National Bank of Austria governor challenges economists to think about the quality of economic growth, suggesting this could have implications for the pursuit of structural reforms
BIS researchers find evidence of macro-pru and monetary policy cancelling out
Study of macro-prudential policy in South-east Asia shows policies work best when used in same direction; paints complicated picture including ‘some evidence’ of spillovers
BoE’s McCafferty says UK not yet in ‘true deflation’
External MPC member says ‘dangerous but rare’ deflation has not taken hold in the UK, although inflation expectations have shifted down slightly
Philippines 5% leverage ratio causes few ripples
Central Bank of the Philippines brings in one of the highest basic leverage ratios globally, but local firms are unconcerned
Sarb deputy wary of weaker currency with inflation rising
Daniel Mminele warns any ‘significant weakening’ in the South African rand in response to a Federal Reserve rate hike could cause inflation outlook to deteriorate
Canadian central bank lays out three ‘key’ vulnerabilities in financial system
Bank of Canada warns vulnerability associated with household indebtedness is ‘edging higher’ and points to imbalances in the housing market and investor risk-taking in financial markets
Zimbabwe pulls local currency from circulation
Locals will be able to exchange their Zimbabwean dollars for US dollars until September 30; any amount up to Z$175 quadrillion in their bank accounts will be swapped for a flat $5
EBA recommends balance between filling resolution fund and procyclicality
European Commission could allow some variation in banks’ contributions to Single Resolution Fund to avoid procyclicality, but reaching the fund’s target level is ‘first priority’
ECCB sees sense in scrapping cents
Eastern Caribbean Central Bank insists ‘everyone will benefit from the withdrawal’ of one and two cent coins from July, as they are expensive to produce and carry very little purchasing power
Weidmann sees bond reversal as ‘a kind of re-normalisation’
Bundesbank president argues sell-off is a ‘correction of market overshooting’ in the wake of ECB asset purchases; insists volatility is ‘not exceptionally high’ at present
Fed taper could hit African sovereign credits hard, World Bank warns
Cross-continent trade agreement could help provide bigger markets and greater efficiencies, but African economies face tough times ahead with borrowing costs set to rise
Philadelphia Fed survey sees brighter outlook for economy
Survey of US forecasters shows outlook of higher growth and lower unemployment than previously thought by the end of 2015; inflation expected to return to target next year